Data and Code for: The Cyclical Behavior of Unemployment and Wages under Information Frictions
Principal Investigator(s): View help for Principal Investigator(s) Camilo Morales-Jimenez, Federal Reserve Board
Version: View help for Version V1
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| Data | 09/02/2020 02:06:PM | ||
| Document | 08/31/2020 01:30:PM | ||
| Programs | 07/21/2020 09:15:PM | ||
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application/pdf | 95.6 KB | 07/21/2020 05:15:PM |
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application/pdf | 480.5 KB | 11/23/2020 04:21:PM |
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text/plain | 16.4 KB | 09/02/2020 10:29:AM |
Project Citation:
Morales-Jimenez, Camilo. Data and Code for: The Cyclical Behavior of Unemployment and Wages under Information Frictions. Nashville, TN: American Economic Association [publisher], 2021. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2021-12-17. https://doi.org/10.3886/E120368V1
Project Description
Summary:
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I propose a new mechanism for sluggish wages based on workers' noisy information about the state of the economy. Wages do not respond immediately to a positive aggregate shock because workers do not (yet) have enough information to demand higher wages. The model is robust to two major criticisms of existing theories of sluggish wages and volatile unemployment, namely that wages are flexible for new hires and the flow opportunity cost of employment (FOCE) is pro-cyclicality. The model generates volatility in the labor market as well as wage and FOCE elasticities with respect to productivity consistent with the data.
Scope of Project
JEL Classification:
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D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
E24 Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
E24 Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
Time Period(s):
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1979 – 2015
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